Editor’s blog Monday 20 September 2010: NHS Confederation Policy Salon: what will happen in a liberated NHS?

The inaugural NHS Confederation policy salon of the new season took its cue from Glenn Hoddle’s mantra “I’ve never made predictions and I never will”, seeking to discern how things will look in 2013. What will liberation look like?

General context-setting suggested that while the White Paper has adequately mapped the anatomy of the new system, its physiology remains an unknown. Potential conflicts appear on considering various implicit assumptions which underpin the thinking behind the White Paper.

One is the issue of agency – the strong presumption that there is no conflict of interest between what patient and GPs want. Another is the apparent faith that acute trusts can adjust their costs downwards or grow new markets very quickly.

Continuity AND change
The White Paper’s objectives (better outcomes, more patient-centred care) and many of its means (clinical engagement) are of course not new. One view was that Equity And Excellence: Liberating The NHS is distinctive in its commitment to localism, reduced bureaucracy and greater transparency: its reforms offering a blend of the technocratic and the political.

Technocratically, much builds on refining the Blair / New Labour market reforms and on reworking regulation to be stronger and more independent, particularly in the form of the new economic regulator that Monitor will become.. In provision, the drive to more freedom for FTs and social enterprises aims to see a thriving social enterprise sector (as Transforming Community Services tried and broadly failed to do).

Involving GPs more in resource use decisions and promoting patient choice also continue with existing themes.

Clearly, the political aspects of the White Paper are more distinct. Its faith in the ‘Big Society’, and consequent smaller state and public sector, blend with the technocratic aspects, with intriguing possibilities and pitfalls around the strengthening of local authorities’ role in healthcare and integrating it with social care.

The White Paper fundamentally views the statutory structure of PCTs and SHAs as innovation-stifling layers of bureaucracy (not as essential components of system of public accountability, giving the Treasury a means to hold resource-committers to account for value for money). This creates uncertainty, since many PCT / SHA roles will still have to be done somewhere in the new world – the roles may be recreated in GP commissioning consortia, local authorities or the private sector.

The integration of health with local authorities is not necessarily well-understood yet. One unknown is whether the Lib Dems can influence the arrival of meaningful power for local health and wellbeing boards. There is also an unresolved question whether local authorities want to be doing this work.

Greater focus on outcomes is a rhetorical aspiration of all healthcare systems. The White Paper’s promises on targets are at least partly political reaction to New Labour’s  “ targets and terror” approach. The new approach, of holding the independent national commissioning board accountable over a five-year period for outcomes struggle, since outcomes improve slowly (and will tend to improve over time), and it is unclear how to measure marginal additional health outcomes from better performers.

In one possible future, the system becomes much more centralised (contrary to the White Paper’s rhetoric) if the national commissioning board uses its power as an accountability scheme for local commissioning consortia. Local authorities could be marginalised (or choose to be so).

Alternatively, if the economic regulator Monitor grips the system, the shape of the supply-side will be determined by market rules, leaving system regulation via public accountability in the dustbin.

Healthcare systems can be shaped by markets or by planning. The White Paper’s philosophy presents management as a cost; not an investment. It also strongly seems to imply that planning healthcare systems is bad.

Coherence in politics – over-rated
An alternative perspective, however, might regard consistency in politics as over-rated, saying that in reality, people often act against stated intentions. Incoherences and contradictions are therefore normal, and their working-through is in fact usual.

The White Paper emphasises its purposefulness repeatedly.

Health policy by W B Yeats
Moreover, the current NHS system has its incoherences, and as a consequence things mess up and fall apart. (This brought to mind WB Yeats’ The Second Coming - “Things fall apart; the centre cannot hold … what rough beast, its hour come round at last, slouches towards Bethlehem to be born?”)

A political critique of the White Paper can note its profound anti-state ideology, arguing that the coalition government features the the two mainstream Westminster who feel that the state is an intrusion into people’s lives and tax confiscates money under law, and state bureaucrats tell people what to do. The concept of ‘liberation’ from the state is quite extreme in post-WW2 British politics.

A potential problem for the White Paper is that the Conservative Party only won the biggest share of the vote at the general election by repeatedly emphasising their belief in the state-funded-and-run NHS. Now they must separate Tory anti-statism from the fact that the British people have and value a public-sector NHS.

The Conservative Party’s experience of NHS managers is not deemed positive – many of their local candidates are unhappy with the lack of control they can exercise over the PCT. This adds to the view of many Tory activists that the NHS has been treated too generously with immunity from financial cuts.

Local government always creates ambivalence with a new national government. Coalition policy is confusing on local government: they apparently want local government to reduce itself. moreover, many Conservative councillors had been convinced that they were going to get commissioning powers over NHSfunds, which was never likely.

The White Paper talks about markets in healthcare as if they exist and simply require extending or amending: some felt that there are no real markets at present, and the economic regulator’s job will be to create them.

Another problem arises if the private sector continues to find the plans too unclear to warrant taking risks and investing in provision or commissioning over the next few years, as NHS plenty dries up.

There are also issues about highly precise centralised targets in the White Paper: reducing management costs by 45% by 2014 (neither 44% not 46% …). The tension of the Secretary of State for Health’s ambitions to reduce the state and the very job title he holds ‘a secretary of what he wishes to reduce – are dynamic. Reducing statutory organisations (PCTs and SHAs) could require more statutory organisations, in a potentially emerging irony.

Thoughts from the debate
‘Big Society’ ambitions require a reservoir of civic activism which may not exist, and evidence from the foundation trust movement is highly equivocal that it does. If it does not, there will be problems.

GPs tend to refer patients up the value chain. In one possible future, local government and GP commissioning consortia work together in some areas to lobby for higher spending, leading to greater loss of financial control. Local government’s electoral legitimacy would create a mandate.

At present, the NHS overspends in not a few localities with the single body of the PCT commissioning. Is there good evidence that the involvement of local authorities will make this situation better?

The new structure will emerge over 2-3 years, iterating according to events. This process will influence its ultimate shape.

GP multifunds in many areas ended up appealing to the centre for more funds.

If financial control is applied by central locks and top-slices due to treasury concerns, we could see an even more centralised system than we have now.

The hunkering-down mentality is making PCTs change-averse over reconfiguration. providers are entrenching ias a consequence.

The cultural clash between local authorities and GPs will be amusing: both are basically part of different ‘tribes’ in many communities. It is unclear that local authorities will emerge the winners: the oversight role proposed may be one they do not want to take on. Local authorities have a good record in expenditure control as councillors can be surcharged, sued or imprisoned for misusing public money. This is not a dioscipline that PCt boards have ever faced: the only sanction being a threat of non-reappointment.

The interests of individuals and populations will conflict in the new system. In current public and patient involvement, questions raised are still generally about micro-issues of individuals’ experiences of care (unsurprisingly); a few get the bigger picture, but it is the minority. This leads to questions about how (or whether) GP commissioning consortia will seek some democratic legitimacy locally.

Local authorities seem to be horrendously confused on their future roles in the new system.

Power in the NHS has traditionally sat in providers – principally, in large acute teaching hospitals. The White Paper promises to overturn this. The transition could consolidate power in providers; alternatively, GPs might have phenomenal power. It is very unclear.

The Health Secretary repeatedly describes power in the NHS as a zero-sum game – he must give some up if others are to have it. However, other healthcare systems do not accept this idea, and feel that more power can be distributed into the system.

For all the NHS’s changes in power and structures, it has never tackled the information asymmetry between acute providers and commissioners.

Choice may produce some benefits, but research suggests that it may offer an opportunity to exit while not making any impact on the quality of care provided. Providers found national targets such as 18 weeks to be bigger drivers of changing working practices.

The location of power in the new system (whether with GP commissioning consortia, the national commissioning board or Monitor), but the behaviours will be equally important. There will be financial pressures and overspends, and the behaviours that result from these could determine the flow of power more definitively than policy documents. (However, legal status is also likely to play a big part).

Commissioning is ill-defined, and often seems simply a proxy for performance management. In most social insurance systems, insrers-commissioners don’t open the provision box.

Power is really a set of relationships. The power relationship as exercised through commissioning is still not fully developed. The system remains overall nowhere near to exercising commissioning as a definition of clinical pathways and population health risk management. The assumption that the underdeveloped asset of commissioning will simply work better in a new set of hands (GPs’) seems silly. Commissioning requires considerable further development.

Service reconfiguration ought to pay account to the location of the most patients with the greatest need, as well as of the numbers required to make assessment of performance easier. In practice, acute teaching hospitals have a disproportionate voice in the debate.

Commissioning may be sub-contracted by GPCC to small expert groups for clinical conditions, which could negotiate effectively with providers.

The length of the reform process could allow dissent to forment in various niches and localities.

GPs may realise they don’t have the skills for commissioning. Financial or quality failures could reshape provision in the meantime.

GPs often think referral is commissioning – the concept seems to underpin White Paper. The sum of individual referral decisions matters; but we also need strategic decisions on investment around the system and on accountability for outcomes.

In a fully-FT provider system, every struggling provider might as well carry on trading in the hope their competitors will fall over fiorst. This could end up similar to the Polish system, where every acute provider is in deficit and the government ministers turn up with suitcases of money.

Do providers drive reconfiguration? If so, this could be anti-competitive and illegal under European law.

If hidden bale-outs are to end, as the White Paper promises, any provider unable to become an FT will have to be take on by ‘Fire Sale Trust Incorporated

The Coalition Agreement described “employee-owned organisations”; the White Paper refers instead to “employee-led organisations”

There has for some time now been a GMC duty making all doctors responsible for use of resources in the wider population. This has been in the RCGP curriculum for some time. Many doctors are still unaware of this.

If centralisation and ecionomic Stalinism are effective to get the NHS through the transition periord to the new system, the government will face giving local financial liberation about 18 months out from a general election. On the other had, economic Stalinism may fail, creating big reputational risks for the NHS funding concept if the NHS keeps its protected budget while all around are losing 25-40% of theirs and still cannot keep financially continent.

A final reflection
The session was engaging and lively, as these tend to be. Ultimately, though, the mood was much more downbeat about what is coming than I’d expected.

When you’re on the shore and the tide is changing, you can’t see the undercurrents.

But you’d be foolish to ignore them.

As Kipling almost wrote, "If you can keep your head while all around you are losing theirs, you have not understood how bad the situation is".